Off message: Don’t dignify porkies
A tsunami of tastelessness; measuring Moynihan’s brand equity; best wishes to Blankfein.
by John Anderson
It’s a Saturday afternoon in the press office at No 10 Downing Street. The phone rings and a junior press officer picks it up. It’s the Mail on Sunday and they’re looking for a comment on a book excerpt that will appear the following day in which the prime minister is being accused of having unnatural relations with a dead pig during his college days.
For starters, that’s a call you’ll never forget and one on which you can dine out for a long time afterwards.
But what is the proper response to something so bizarre and something that remains to date so unsubstantiated?
The prime minister’s response was to simply say he would not dignify the story with a comment.
Under the circumstances, that’s probably the right public reaction.
There is something about, let him who is without sin cast the first stone, that comes to mind in connection with this episode.
Investment bank press offices routinely deal with inquiries based on unsubstantiated rumours, whether it is mass firings, executives leaving, or traders losing money.
The more credible publications with whom you have solid working relations will take you at face value if you deny those rumours. The more scandalous papers will hear you out, but despite your best protestations, will still run the story.
In days gone by, this kind of incident would have had a very short shelf life. It would be dismissed as an expression of youthful foolishness and forgotten rather quickly.
Alas, we live in a different world today. Between Twitter, Facebook and the other forms of social media, this story has run on and on, invoking a whole tsunami of tasteless jokes and bad puns.
It can’t be fun being David Cameron at the moment, but he can take solace in the fact that even something as strange and scurrilous as this allegation will ultimately pass.
Brian Moynihan may have won a victory over a move by independent shareholders to have the chairman and CEO positions separated at Bank of America, but he has also drawn a huge target on himself in doing so.
By keeping both positions, Moynihan has put himself in the frame for some rather close scrutiny of his stewardship of the bank over the past nearly six years.
There is something very counter-intuitive in having to share with the world the kind of news that is so intimate in nature
The vote has also proved a challenge for the BofA media relations team. At the recent shareholders meeting, 63% of the votes were cast in favour of keeping the positions combined – meaning more than a third of shareholders, including large pension plans such as Calpers, wanted to bring in an independent chairman in line with best practice of corporate governance. Those numbers are hardly an overwhelming show of support for the board’s approach – something that the PR team has sought to deal with by pointing to Moynihan’s track record and arguing that his accomplishments have merited his keeping both titles.
Alas, that hasn’t been an easy job. The vote also comes at a time when BofA is struggling to grow its revenues in the face of low interest rates and the firm’s efficiency ratio is still well behind that of other leading US banks.
There are those who argue that Moynihan’s brand equity is founded in the past through his guiding the bank out of the financial crisis. But that was then and this is now. If he can’t inflate the share price, trim costs and effectively grow revenues, the decision to maintain both jobs will be a short-lived victory.
As one would expect, Goldman Sachs handled the news of chairman and chief executive Lloyd Blankfein’s cancer diagnosis in a stylish, calculated manner. The internal memo was brief but informative. By signalling the disease was “highly curable”, Goldman injected the right amount of optimism and hope. By declaring that, with the exception of international travel, Blankfein would continue to carry out his duties, it further signalled only minimal disruption in the senior management of the firm.
Yet for all that, there is something very counter-intuitive in having to share with the world the kind of news that is so intimate in nature.
Fortunately I’ve never had to communicate this sort of thing on behalf of a CEO, but I can imagine how challenging it would be to help in the drafting of that kind of missive.
Sitting across a table from someone who has just been diagnosed with a potentially fatal disease and then having to discuss its PR ramifications is daunting to say the least.
Perhaps the most challenging aspect is the need to bring up the point that with the announcement will come stories addressing the issue of succession within the firm.
In Goldman’s case, the PR department used the occasion to demonstrate just how deep and competent the firm’s bench strength is.
If you looked around the investment banking landscape today, it’s fair to say that there are a number of banks where it would be difficult to identify even one clear candidate to succeed the current CEO.
But in the stories that followed the Blankfein announcement, as many as a half a dozen senior Goldman executives were identified as potential successors – and that speaks volumes about the Goldman culture.
My guess is that the story will now go underground. Out of deference to Blankfein, most journalists will keep a watching brief on the situation in the hope that the next announcement will be one indicating the cancer has been cured. Let’s hope that comes sooner rather than later.